HBO Max and Discovery+ to Go Global Together

Warner Bros Discovery will merge Discovery+ and HBO Max into a single streaming platform internationally, Variety reports.

“Sources tell Variety that Discovery and AT&T’s WarnerMedia — which are expected to merge in the next month — plan to have one single global platform that will combine the two streaming services, as opposed to a market-by-market approach for international.”

But it’s still unclear what this will mean for NZ, given last August Sky not only renewed but also expanded its WarnerMedia multi-year deal that makes it the exclusive home of HBO in NZ (although Discovery NZ executives are excited about what the merger means for their operation).

The Variety report signals that the new venture will look at other means of adding value in markets where existing HBO licenses will preclude an HBO Max service, such as the UK, where’s Sky’s HBO rights don’t expire until 2025.

The CFO of the newly combined Warner Bros. Discovery, Gunnar Wiedenfels, suggested in a conference call that sports rights will be a crucial pillar for the combined service in the UK, citing the “opportunity for a combined sports and Discovery Plus package at a time when HBO Max is still encumbered by long-term licensing deals”.

These deals affect not only NZ and Australia but also markets as pivotal as Germany and Italy (WarnerMedia has confirmed there won’t be an HBO Max in these territories until the Sky deals end two years from now).

Last year Bloomberg described the Sky deal as “an example of the tangled international rights that HBO Max is navigating as it tries to catch up with Netflix and Disney+ around the world.

“The Sky agreement has been lucrative for its parent, WarnerMedia. But analysts say it threatens to slow down HBO Max in a fast-moving global race for streaming domination.”

This, of course, was before the merger with Discovery and the joint global clout the two giants will have to exploit the advantages streaming internationally holds for them over linear markets.

“Direct to consumer internationally is going to be an exponentially better business for us than the linear world, because we’re coming from a market that has so far been defined in some countries as 15 per cent-20 per cent of households [having] pay TV, and we had a share of that market,” Wiedenfels says.

“Now, all of a sudden, with direct to consumer, you’re able to address essentially the entire population, and from a distribution partnership perspective, you’re opening yourself up to mobile distributors etcetera.”

Subscription costs for the new platform have yet to be revealed but ad-free and ad-lite models will be available.